Single euro payments area regulation

KEY POINTS

• National accounts used for credit transfers and direct debits within each SEPA member country should also be accessible throughout the EU. This is known as reachability.
• The same rules apply to both national and cross-border operations.
• Payment systems should be interoperable with each other.
• The regulation requires credit transfers and direct debit transactions to meet certain conditions, including:
  • the use of international bank account numbers (IBANs), bank identifier codes (BICs) and a financial messaging standard for all payments in euro;
  • the right of payers to issue specific instructions, such as the amount and frequency of a direct debit.
• Amending Regulation (EU) 2024/886 allows payment service users to transfer money within 10 seconds at any time of the day, including outside business hours, not only within the same country but also between EU Member States.
  • It requires payment service providers that offer their users a payment service of sending and receiving non-instant credit transfers in euro to also offer them a payment service of sending and receiving instant credit transfers in euro.
  • Payment service providers must ensure that all payment accounts that are reachable for non-instant credit transfers in euro are also reachable for instant credit transfers in euro 24 hours a day and on any calendar day.
  • Payment service providers located in a Member State where the currency is not the euro are not obliged to offer users the payment service of sending instant credit transfers in euro beyond a limit that is not lower than €25,000 per transaction, with the level of the limit being set by the competent authorities for a period of 1 year and extendable for additional periods of 1 year at the discretion of the competent authorities. Such a transaction limit could be applied only with respect to instant credit transfers in euro that are sent from payment accounts denominated in the national currency of that Member State, during the time when a payment service provider neither sends nor receives non-instant credit transfer transactions in euro with respect to such payment accounts.
  • Payment service providers must ensure that the charges that they levy on payers and payees in respect of sending and receiving instant credit transfers in euro do not exceed the charges levied by them in respect of sending and receiving non-instant credit transfers in euro.
  • Payment service providers will be required to verify that the beneficiary’s IBAN and name match in order to alert the payer to possible mistakes or fraud before a transaction is initiated. This requirement applies to both instant and regular credit transfers in euro.
• Regulation (EU) No 260/2012 set the following entry dates:
  • from 1 February 2014 (later postponed to August 2014), all credit transfers and direct debits in euro to be made under the same format in EU Member States with the euro as national currency;
  • from 31 October 2016, all credit transfers and direct debits in euro to be made under the same format also in non-euro Member States;
  • from 1 February 2017, the abolition of multilateral interchange fees¹ for direct debits;
  • from 1 February 2016, an end to compulsory use of the BIC.
• Deadlines for payment service providers to comply with obligations laid down in amending Regulation (EU) 2024/886 are spread over time, starting on 9 January 2025 and ending on 9 June 2028, depending on the type of the obligation and on the Member State where a payment service provider is located.
• Member States had to:
  • appoint a national authority with the necessary powers to ensure the legislation is fully implemented;
  • lay down, by 1 February 2013, rules on penalties for any violations of the legislation;
  • establish adequate and effective out-of-court complaint and redress procedures.
• The following rules were put in place regarding the European Commission.
  • It was given the 5-year renewable power from 31 March 2012 to adopt delegated acts.
  • It had to present a report by 1 February 2017 on the implementation of the legislation.
  • It has to present a further report by 9 October 2028 on the application of the legislation, accompanied, if appropriate, by a legislative proposal evaluating the development of charges for payment accounts and for national and cross-border credit transfers and instant credit transfers in euro and in the national currency of the Member States where the currency is not the euro since 26 October 2022. This report will also assess whether the method that payment service providers are required to apply for the purposes of complying with the applicable sanctions screening obligations is effective in preventing unnecessary hindering of instant credit transfers.